AIG, America's largest insurer, announced it is borrowing more funds from the Fed. "They need more liquidity than they thought" remarked an analyst at William Blair & Co. The money will go towards helping AIG cover requests from clients to redeem borrowed securities.
But can AIG be trusted with the bailout money?
Days after the bailout it was reported AIG spent $440,000 on a California retreat involving banquets, spa treatments and golf.
These expenses are being subjected to some hard-nosed analysis by New York Attorney General Andrew Cuomo (the function of the Attorney General is to act as the chief legal officer of the State, protecting consumers, investors and businesses throughout the state). In addition, $19m in payments to former AIG chief executive, Martin Sullivan, have been frozen as AIG plays ball with the investigations - which will also review executive compensation.
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